Sales engineer salary - how does it work? (2020)

Role details, total compensation and how to negotiate

Whether you're an experienced sales engineer or just starting out, this guide will cover everything you need to know about the role, job market and total compensation/ salary range.

👩🏻‍💻What do sales engineers do?

Similarly to product managers, what people perceive as a sales engineer can be completely different depending on teh company culture. The role can also have different job titles set by recruiters like: re sales engineer, field sales, field engineer, solutions architect, solutions consultant, etc. This makes it much harder to nail down an accurate salary range. There are two main distinctions between sales engineer roles: 

  • Some SE will be paired with an account executive or sales. In this case, your role is purely technical, and you are mostly likely paid straight salary + annual bonus. You are acting as a sort of sales support/ technical support versus leading the sales process - bringing in the customer falls on the sales team but customer success falls on you.
  • In other cases, SE is *the* "sales guy". These roles are usually less less technical. In addition to cash compensation, you can expect to be paid commission and carry quota.

Bottom line - get ready to ask plenty of questions of each prospective employer to get a good idea of what their sales engineer role entails. Figure out what you will like best to find a role where the company culture has the right trade-off between technical knowledge requirements and account manager dynamic with clients. 

How to get the job?

Most entry level sales engineer jobs ask for at least a bachelor's degree. You don't need prior experience as a software engineer, but you should have a deep level of technical knowledge (particularly around system architecture) and strong interpersonal skills. Commonly, you can transition into the role if you started out in sales as an account manager, operations or were an applications engineer/ systems engineer prior or a related job.

🤔Will I like working as a sales engineer?

Pros

  • High earning potential. Sales engineers have very competitive total compensation. Technical sales are a hard skill to hire for and sales engineers sometimes make more than product managers, engineers or scientists.
  • Extrovert heaven: It's a dynamic job where you meet clients frequently and are exposed directly to the market.
  • Frequent change of scenery: Most of the sales engineers are only on the hook until the sale is closed and then move on to the next client, leaving the account manager in charge of maintaining the relationship. It can be thrilling to show clients all the bells and whistles but not have to hand-hold them through troubleshooting.
  • In-the know: Sales engineer is in the best position to sniff the shift in the market and often have the most high-leverage client exposure, even more than product managers.
  • Strong Career Options. A successful SE can write their ticket as a consultant, PM or in a senior sales role in the org - however, most career opportunities will requirew a role switch. Not uncommon, you can also get offers from potential customers.

Cons

  • Irregular hours: Sales engineering is generally not a 9-5 job. There are days where you will work 12-14 hours or be on call, as well as times where you'd have nothing to do for long periods.
  • Low political profile. While you have the best pulse on the market, you are expected to give all glory to the product management team. Your role will often have little influence inside of the org, unless you significantly over-perform your target. This can be frustrating and many SE's end up in product for this very reason.
  • It's mostly your fault. All fingers will point at you if the client feels like they've been "oversold".
  • Windy career path: Sales engineers are considered a support, not a core function of the sales process. This can make direct promotions difficult in mid-size or small orgs. The trade-off is higher base_salary +better total compensation, especially as you add years of experience. But it can be frustrating to not rise in authority or political influence in the organization.

🧮So what's the average sales engineer salary?

Recruiters find it hard to fill this role, especially for senior sales engineers. Why? At a minimum, the job description requires both technical experience in what you are selling and strong soft skills. It can feel like trying to find a needle in the haystack and so recruiters are inclined to pay sales engineer salaries comparable to what an experienced engineer would be making and sometimes more.

How your total compensation works:

As an entry level SE, this can be insanely confusing and a lot of the " average salary" numbers out there are actively harmful because they're put together by people who don't get SE compensation. So let's start by explaining what OTE is and how it's calculated:

Typical Compensation plan for an SE includes:

📌On Target Earnings (OTE) = Base Salary + Variable Bonus based on performance.

  • OTE= On Target Earnings defined by you hitting all of the performance goals laid out in your plan
  • At some (but not all) companies, the OTE will be supplemented with an equity grant and sign on bonus

The base salary is usually 70-80% of OTE. So you might hear " We're on a 70/30 plan here" from the recruiter, which sounds super confusing as an entry level candidate. Let's break it down - The 70/30 is based on the total. So if your base salary is 100k; they expect with commission, bonus, milestones, or whatever that your total compensation will be 145k. You are essentially guaranteed cash compensation, $100k , and anything past that is performance based.

🚀Let's talk more about the variable - this is the meat of your total compensation.

The variable is typically comprised of a revenue quota and/or MBOs. This can vary company to company. For the quota aspect, an SE is usually tied to a region, vertical or product.

Mature Companies and Late stage Startups

Your variable will be likely tied to a sales quota. The arrangement here is very straightforward: you make quota, you get your full variable. However, sometimes there are additional complexities like a " floors", " caps" and " accelerators":

  • Floor- you only get paid out your variable IF your team hits a minimum goal, called a " floor". For example- a "60% floor" means your team has to hit at least 60% of its overall sales quota or you get paid nothing.
  • Accelerators - when the team achieves more than the 100% goal quota, your variable will be amplified by points or multipliers that can exponentially increase your OTE.
  • No cap- if means there is not an upper limit to how much you earn through your accelerators. A lot of companies will have a cap so read your contract carefully.

Smaller startups and new sales orgs

Smaller organizations will more heavily rely on MBOs ( Management By Objective). As the name suggests, this type of plan rewards the salesforce meeting objectives vs predefined quotas. Often times these goals will be individually assigned, sometimes in addition to a quota and base_salary.

Good MBOs will be very specific and have discrete timelines within your first year of employment, and beyond. Your hiring manager should be able to explain clearly how the MBO ties to the overall org goals and how you will track progress and record completion.

👋 Before you negotiate

Before you even think of asking for more money, you should have a clear idea of how tangible the company's opening offer is. Why? Because even if your OTE is very high, how your variable comp works is what determines what you'll take home at the end of the day.

Questions to ask before negotiating

  • Who is on the team now? How is the team structured?
  • How has the team performed in the last 3 quarters?
  • How many times in the last 2 years has the team hit 100% of their quota and taken advantage of accelerators?
  • How does your plan work if you start mid-quarter?
  • Will your plan start immediately?
  • Will there be a draw? An MBO?
  • If the company is public, are there RSUs? If it’s private, any other long term cash incentive program, or ability to earn equity?
  • Am I supporting a new or existing product? How does this product perform against others that you sell?
  • What is clients' biggest pain point?
  • What are the financial projections at a high level for the next year?
  • And finally, ask them to walk you through the math of your comp with some examples.

In some cases, if you're joining as a new hire AND a very early employee ( maybe sales employee 1 even), be mindful that the company might not be able to answer all of these questions to your satisfaction. In these situations, we recommend asking for an OTE guarantee as part of your negotiation to account for the runway the company needs to feel out the market.

You can refer to your salary negotiation guide here for general tech salary negotiation advice or schedule a time to talk more specifically about technical sales engineer negotiations.


Is your offer competitive?

Find out how much you’re worth and how to ask for more — the right way.

Loading...